Coal India Q1 net profit dips 14.7 per cent

Kolkata: Coal India posted a 14.7 per cent dip in net profit in the first quarter as slowing growth in electricity demand resulted in lower-than-expected proceeds from coal sales.

The company reported a profit of Rs 3,065.26 crore in the three months ended June compared with Rs 3,596.92 crore a year earlier, Coal India said in a statement. Income from operations declined to Rs 18,421.87 crore from Rs 19,518.08 crore.

Revenue fell even though the company’s sales of coal increased 3% to 133.24 million tonnes. Coal has been piling up in the stockyards of power plants, which have cut generation amid less-than-anticipated growth in electricity demand.

Despite selling more coal, net income dipped because average realisation from e-auctions dipped from Rs 2,184 per tonne to Rs 1,570 per tonne in the first quarter, leading to declining net realisation from sales, Coal India Chairman Sutirtha Bhattacharya said.

According to analysts, the fall in average realisation from e-auctions was the result of lower international coal prices and softening of demand in the global and domestic markets.

Coal India said interest income from fixed deposits dropped by Rs 254 crore.

The company reduced expenses by 3% to Rs 14,834.20 crore against Rs 15,320.81 crore in the previous corresponding period. Contractual expenses increased to Rs 2,800.55 crore against Rs 2,488.7 crore a year earlier.